Biden state of the union uncorks high-stakes standoff over U.S. debt

We've now witnessed the opening scene of what could be a major months-long drama. U.S. President Joe Biden's state of the union address uncorked a public standoff over debt. Judging from the raucous scene, the debt-limit fight could get messy.

We've now witnessed the opening scene of what could be a major months-long drama

Joe Biden's annual state of the union address produced the opening scene of what could be a major months-long drama over the U.S. debt limit.

It was a rowdy and revelatory moment.

The health of the world economy and the very reliability of the United States as a debt issuer rest on the disorderly body of politicians gathered Tuesday to hear the U.S. president.

Among all the issues before this Congress, where the president faces a new, hostile Republican majority, a looming tussle over the U.S. debt level may hold the greatest global consequence.

The parties must reach a bipartisan agreement to raise the country's de facto credit-card limit this year, to prevent the previously unthinkable scenario of a U.S. debt default.

At issue is a Republican demand for spending cuts. Republicans say they want some fiscal control before agreeing to raise the debt limit beyond its current level, $31.4 trillion.

Biden warned of dire consequences. He accused Republicans of plotting to cut pensions and seniors' health care and that accusation instantly triggered an eruption of jeers in the chamber.

Republican howl in opposition

That's because Republicans insist they won't touch the most expensive programs. Not politically popular ones like Medicare, Social Security, and military funding, which represent half the federal budget.

The president based his claim on a platform Senate Republicans technically ran on, which proposed that all federal programs expire unless renewed by Congress.

What Biden omitted to mention was that this platform was later emphatically repudiated by Republicans' Senate leader, Mitch McConnell, and that Republicans insist those programs are exempt.

So Republicans howled in protest at what they deemed to be a slanderous attack from the president.

Firebrand Republican U.S. Representative Marjorie Taylor Greene shouted, "Liar!"

Biden joked about being delighted to hear Republicans loudly insisting they'll protect social programs: "I enjoy a conversion!"

Meanwhile, behind him, at the back of the podium, the new Republican leader in the House of Representatives, Kevin McCarthy, was trying to control his boisterous troops.

The difficult math on the U.S. deficit

McCarthy offered a discreet shake of his head, or a hand gesture, in various efforts to get his caucus to display the parliamentary decorum he'd promised.

It may have been a snapshot of what's ahead.

Can McCarthy keep those troops in line? Enough Republican backbenchers will, at some point this year, have to rally around McCarthy and back a deal to end the debt staredown.

U.S. President Joe Biden used the state of the union to call on the U.S. Congress to lift the debt ceiling, calling out the Republicans for wanting to 'take the economy hostage,' eliciting jeers and heckling in return.

It's not yet clear how easily he'll mollify conservative budget hawks, who hold enough votes to end McCarthy's leadership.

That's because the U.S. seems destined to keep piling up new debt for the foreseeable future.

Neither party wants to touch Social Security (old-age pensions), Medicare (the public health plan for seniors), military funding, or veterans' care; in addition to that, Republicans oppose tax hikes.

What would it take to balance the budget under those conditions?

According to the Washington-based Committee for a Responsible Federal Budget, it's virtually impossible; it would require the near-elimination of the rest of the U.S. federal government.

The non-partisan think-tank concludes that, to balance the budget in 10 years, under those conditions, you'd have to chop 85 per cent of all other spending.

Biden pitches immigration deal

The heckling of Biden's debt-ceiling message was the first of several moments where the new Republican majority jeered the president.

Another example came when he proposed a watered-down immigration deal: added border security in exchange for legal status for some undocumented people, mostly youngsters.

They heckled when Biden referred to the fentanyl epidemic, yelling that his neglect of border security was letting drugs flood into the country.

But the president drew a number of ovations for his populist economic message.

In a fiery speech, he promised to keep pushing Buy American policies.

He blasted corporations and proposed laws targeting stock buybacks; hidden fees in plane tickets, resorts, and concerts; tech companies' data-collection; pharmaceutical prices; and non-compete clauses in employment contracts.

Biden's populist re-election message

"For too long, workers have been getting stiffed," Biden said.

"But not anymore…Too many people have been left behind or treated like they're invisible. Maybe that's you, watching at home."

It's not clear how much of this, if anything, will pass this divided Congress, which will have enough trouble just agreeing to pay off U.S. debts.

What is becoming clear is the message Biden plans to take to the electorate if, as expected, he seeks another term.

He referred repeatedly to the achievements of the last Democrat-controlled Congress and referred to the remaining items on his to-do list.

A dozen times in his speech, Biden repeated the phrase: "Finish the job."

Can he win again?

Historical precedent suggests something of a coin flip, at this point. His approval rating, entering his third year, is not good, but not fatal.

It's similar to the approval level of predecessors Bill Clinton, Ronald Reagan, Jimmy Carter and Donald Trump at this stage of his presidency.

Two were re-elected, two weren't.

Biden stumbled early in his speech with the sort of linguistic lapse that has some party allies unnerved about him running for a second term, which would end when he's 86.

He incorrectly referred to Chuck Schumer, the Democrat, as the Senate minority leader. Schumer is the majority leader.

In the Republican response to the state of the union, Arkansas Gov. Sarah Huckabee Sanders called several times for generational change, an apparent poke at both Biden and her former boss, Donald Trump, when she was White House spokeswoman.

But that's next year's contest.

In this year's big standoff, on Capitol Hill, we'll see how close the United States comes to a debt crisis.


Alexander Panetta is a Washington-based correspondent for CBC News who has covered American politics and Canada-U.S. issues since 2013. He previously worked in Ottawa, Quebec City and internationally, reporting on politics, conflict, disaster and the Montreal Expos.

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